The True Cost of Employee Turnover and Disengagement
According to Gallup research, employee engagement remains a critical challenge for organizations across industries. As of May 2025:
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32% of employees are actively engaged.
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51% are not engaged.
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17% are actively disengaged
Disengagement is not a morale issue alone—it is a measurable financial risk.
Disengaged employees contribute to increased turnover, absenteeism, safety incidents, and declining customer satisfaction. Gallup estimates that disengagement can cost organizations 18–34% of an employee’s annual salary in lost productivity.
For example, an employee earning $80,000 annually may cost an organization more than $14,000 per year if disengaged.
Cost of the New Hire
Recruiting new employees is a necessary part of running a successful organization. However, persistent turnover and limited internal growth opportunities often create a costly cycle of unnecessary hiring. Beyond direct recruiting expenses, this cycle strains leadership capacity, disrupts teams, and inflates operational costs—ultimately impacting organizational performance and the bottom line.
The calculator below estimates the first-year financial impact of replacing a single employee, based on industry benchmarks and hiring variables. If the results raise concerns, Cavalier Consulting & Leadership works directly with senior leaders to address the underlying causes of turnover and disengagement through practical, on-site, leadership-centered solutions.
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